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Proponents of historical cost ordinarily maintain that in comparison with all other valuation alternatives for general purpose financial reporting, statements prepared using historical costs are more

A. verifiable.
B. relevant.
C. indicative of the entity's purchasing power.
D. conservative.

Respuesta :

Answer:

D. conservative

Explanation:

Historical cost method relates to recording of assets at their historical i.e original cost instead of recording them at their increased/revalued values.

Such a method ensures compliance with law of conservatism or prudence which simply states, "do not anticipate a profit, but provide for all possible losses".

Preparing financial statements based upon historical cost assumption ensures reliability and avoids overstatement of assets. This means investors, government and other stakeholders can place better reliance upon credibility of such financial statements.

Martebi

Proponents of historical cost ordinarily maintain that in comparison with all other valuation alternatives for general purpose financial reporting, statements prepared using historical costs are more  verifiable.

For better understanding, lets explain what the historical cost are

  • A historical cost is simply used by individuals to rate or quantify. It is mainly used in accounting where the price of an asset on the balance sheet is due to the original cost of which a specific item was bought or acquired by a company. It is often  is used for assets via generally accepted accounting principles (GAAP) in some major countries.  
  • Historical account can be proved

from the above, we can therefore say that the answer Proponents of historical cost ordinarily maintain that in comparison with all other valuation alternatives for general purpose financial reporting, statements prepared using historical costs are more verifiable is correct

learn more about historical cost from:

https://brainly.com/question/17329408

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